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How To Handle Your Finances When You Lack Shared Goals

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Roger has his heart set on taking his children to Disney. 

When he was young, his family went to Disney every couple of years, and he remembers really enjoying the vacations. 

He is the budgeter in the family, and he’s scrimping and saving for the trip dollar by dollar. He’s frustrated, however, because his wife, Sheila, keeps spending money that could be saved for Disney. 

Just last week she bought the kids new outfits that Roger feels they didn’t need. She spent $110, and Roger is angry because that money could have gone to the Disney fund. 

finances when you lack shared goals

While Roger and Sheila are generally happily married, this issue is causing strife in their marriage.

How To Handle Your Finances When You Lack Shared Goals

While some may look at Roger and Sheila’s current difficulties as a financial issue, or even worse, a deeply seated relationship issue, there may be a simpler explanation. 

They simply don’t share the same financial goals.  

With clear communication and compromise, they can resolve this issue. 

If you find yourself in a similar situation, there are several steps you can take.

Decide If The Goal Is A Priority To Both People

Before you do anything, communicate clearly and see if a goal is a goal for both parties. 

In the above example, Sheila just does not care about a trip to Disney. She thinks it’s ridiculous to pay thousands of dollars for a trip to Disney. If she’s going to go on a vacation, there are many, many other places she’d like to go rather than a packed, hot amusement park. 

If The Goal Isn’t A Priority For Both People

If the goal isn’t a priority for both people, you can decide on a separate plan of action to resolve the conflict.

Save For The Goal Yourself

You could save for the goal yourself, without your spouse. This would definitely take longer, but it will likely reduce arguments. 

In the end, this is what Roger decided to do since Disney is so important to him. Roger will continue to save all of the extra money he has to go toward the Disney trip, and Sheila will use her spend money in a way that she sees fit.   Roger’s disappointed that it will take longer, but he understands Sheila’s point of view.

Alternate Goals

Another idea is to alternate goals. 

In this example, Sheila would get on board with saving and going to Disney.  After the Disney vacation, Roger would agree that the family will go on the ski trip Sheila has wanted to take the kids on.

If you and your spouse can compromise and agree, you’ll reach your financial goals much faster than if you saved separately.

Allow Room For Independent Goals

Just because you’re sharing finances doesn’t mean you have to always share goals.

For instance, my husband loves to go to the mountains because he was raised in a mountainous area. I’m scared of heights, so I find going up and down mountains terrifying.

Still, I recognize that my husband works hard for our family and rarely spends money on himself. Therefore, we do occasionally make trips to the mountains that he enjoys. I’m just along for the ride. 

While there are many other things I would like to do with our money, I recognize his individual interests.

Compromise and Communication Are Key

Compromising on goals and money can be difficult, but it doesn’t have to be, especially if you have open lines of communication. 

Some couples get around this problem by jointly paying for bills and having separate accounts to do with what they wish individually. However, you don’t have to go that route. It is possible to have joint finances and negotiate large savings goals.

How do you and your spouse handle disagreements in savings goals?

What If I Die? Steps To Help Your Spouse Take Over The Budget

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To have both partners in a marriage actively budget their expenses together is rare.

Instead, one spouse is usually the one who handles the budget and the finances. If the budgeter is lucky, his or her spouse will sit down once a month and listen and discuss the current state of finances. 

If the budgeter isn’t so lucky, the spouse will not even sit down to listen to the budget but instead leave the finances completely in the budgeter’s hands.

steps to take so spouse can do the budget

In Kate and Charlie’s marriage, Charlie completely handled the finances.  When Charlie had a stroke and was hospitalized and in rehab for three months, Kate had no idea what bills needed to be paid or even how to get into their accounts electronically.

Unfortunately, this scenario is all too common.

If you’re the budgeter, you should take these steps so if anything happens to you and you become incapacitated or pass away, your spouse will be able to figure out when to pay bills and how to log into electronic accounts.

Make Note Of When Bills Are Due

The first step is to find a way to let your partner know when bills are due.  I’m the budgeter in our family, and I use You Need a Budget (YNAB).  For each bill’s line, I’ve included the amount due and the date the bill is due. 

If you don’t use an electronic budget system, you can simply make a generic calendar and list the name of each bill on the day it’s due and the amount you must pay.

Create A List Of Debts

Next, create a list of debts for your spouse.  You should include the following:

  • Name of the company
  • Credit limit
  • Current balance
  • Minimum monthly payment
  • How to pay the bill
  • List of websites & passwords (more below)

Create A List Of Websites And Passwords

Perhaps the most important piece of information is the list of websites and passwords.

Find a safe place to list all of the websites for the accounts that you have. 

We would recommend a secure password software like LastPass where you can give your loved one a single login, and then they'll have access to all of your important financial website logins and passwords. You can even categorize all of your logins within the software by category (financial/social media/work).

Once whatever software you choose is setup, just give the login name and password to your spouse. If you have a security question, give the answer to that, too.  If you have a picture you must choose before logging in, write down what that is.

Just make all of the information available so your spouse can login even if you can’t convey information to him or her because you’re incapacitated or have passed away.

Setup Emergency Access

If you prefer to not give your spouse your login right now, software like LastPass also have the tools in place to give a trusted contact(s) emergency access to your account.

LastPass emergency contact - Password software

You just enter your trusted contacts in the emergency contacts section, then if they request access if something happens, if you don't respond within 48 hours they'll be given emergency access.

Show Your Spouse Important Information

Next, show your spouse exactly where you’re keeping all of this important information so that he or she can find them if they’re needed. 

For your part, make sure you keep the documents in the same spot you told your partner so he or she can find them.

Keep Your Lists Current

While it’s great to set up this system, if you set it up and then don’t touch it for five years, your partner may still be lost should he or she have to take over. 

Every time you change a password, make the change on your master sheet (LastPass makes this easy). 

Every six months or so, review the information and make sure that it’s still valid.  Over time, you’ll close some accounts and open others, and some bills, like mortgages, may be taken over by other mortgage companies. 

Make sure your list stays current.

While you may be frustrated that your spouse doesn’t participate in the budgeting process, realize that there are likely things he or she does around the home that you have no interest in doing. 

Then, take the time to create a system where your spouse can take over for you with minimum disruption, should the need arise.

Are you the budgeter in the family?  If so, what steps are you taking to make sure your spouse can take over if need be?

what if i die - steps to take for your spouse

Achieve FI As A Couple: Be On The Same Page And Accelerate Your Path To Financial Independence

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Talking about money with your significant other doesn’t have to something you both dread.

It is something that should be fun and help you achieve financial independence (FI) as a couple.

achieve FI (financial independence) as a couple
Having Fun on The Journey to FI

1. Be Open

Be open to new ideas and new ways to not spend money.

On the path to FI you will be introduced to many things that you may have never heard of before. Or maybe you have heard of them, but just brushed them off because you either didn’t understand them or you thought they were crazy ideas.

Something that we had to be open about was what is the best way to invest our money. Mutual Funds vs Index funds. We both knew little about them, let alone what the difference was. We had to be open about taking the time to learn more about them and figuring out what was best for us at this time in our lives and in the market.

Being open to each other about debt, savings, budget, purchases, what you want out of life is crucial to achieving FI as a couple.

2. Look At The Bigger Picture

In order to achieve FI as a couple, you need to look at the bigger picture. You might call it your WHY.

You also need to be forward-thinking. 

Your Why is the biggest part of FI. It is the entire reason to be on the path to FI.  

When going after FI as a couple there needs to be a clear vision, a bigger reason than yourselves, and something you both align on that will always drive you forward. There are many ways to begin defining this!

There are many exercises that can help to think into the future and not just on what you want now. Your language around your WHY will gradually evolve as you understand more about yourself and your relationship. And what direction you ant your life to go in. I recommend trying some different exercises to get your mind thinking about a bigger vision, plus it makes it fun and more enjoyable. 

One of the most beneficial exercises to do to get you looking at a bigger picture was an exercise by Rachel Hollis. Basically, you imagine yourself 10 years from now, your 10 dreams, and your 1 goal. Both you and your partner write out what your best self looks like using specific details on what you have, who you are with, what you are doing, where you live, what you do in your free time, dream BIG. Then write those out into 10 specific dreams. 10 dreams that you want out of life and would do anything to reach. Finally, narrow everything down to just 1 goal you can take action on now. Make it a goal that if you reached that goal you would be working towards multiple of your 10 dreams. Give it a try.

Here are some other examples of things you can try that may be fun to implement into your journey and see if they help in any way. 

Exercises to Try!

  1. Write yourself a letter as if it were 10 years later. Define what you have, where you live, and spend time doing.
  2. Write out your 1, 5, and 10-year goals as a couple each month.
  3. Track your progress.
  4. Celebrate wins together and use that time to write down the next milestone.
achieve FI (financial independence) as a couple
Path to FI as a Couple

3. Be On The Same Page (As Much As You Can!)

Achieving FI is something that takes a lot of discipline. So doing it together with someone else can be complex, but if you are on the same page you can accelerate down the path to FI quicker. 

Most Americans put off financial responsibility, especially in relationships, which can cause a lot of strain on relationships. This is a result of major lack of financial stability usually from living paycheck to paycheck, living beyond your means, consumer debt, etc.

One of the leading causes of divorce is finances. Don’t be another statistic and starts talking about money with your partner.

Read about how we got out of debt here.

Everyone goes through some sort of financial struggles. You are not alone. And everyone has a different story, but everyone has to option to take action.

Having your financial goals in line will be crucial to getting to FI and stability in your relationship. You along with your partner will have to work through a lot of basic things first before you get in deep in our mindset of FI. Some ways to start on your journey to achieve FI as a couple is to read books, work diligently on small financial steps, and asked a lot of questions.

Change your financial mindset click here! 

To stay disciplined to keep progressing and being on the same page you will have to work. And when times get hard, refer back to your WHY!

Here are some fun things you can do together as a couple that may help out with making your financial discussions more fun. 

  • Each month take time together to dream, write your goals, and chat through your future selves. Write your1, 5, and 10 year goals at the beginning of each month and discuss your future selves.
  • Create some games around your finances, budgeting, investments. Like creating a money meter, where you get to color in each time you get closer to your savings goal.
  • Celebrate! When you hit a milestone, take time to appreciate the progress. Can be going to get ice cream or beer or just hanging out at your favorite park.

4. Figure Out Your Values

On your path to achieving FI as a couple figure out what you value and what you are willing to spend your money on. Spend money on the things that you are passionate about and reduce the things you aren’t passionate about.

For some people going out to eat isn’t something that they really enjoyed. They would rather stay at home and cook a meal together. This is cheaper and most of the times tastes better anyways.

What do you value as a couple? Figuring out what makes you happy in life. There is going to be things in life that you value so much that you are not willing to give up, no matter what the price is. And that is OKAY!

5. Have Fun

On your road to Achieving FI, you still need to have fun. And do things in life that make life memorable. In the Mad Fientist Podcast episode #54, Ramit Sethi talks about some of the downsides that people are experiencing on their way to FI. One of the main things he states is that people stop doing anything that they enjoy in life because they feel bad spending money at all. So they stop having fun and enjoying life. Even though they are saving a lot of money, money isn’t everything in life. So he suggests that you decide what it is in life that you truly enjoy and spend as much money on that as you would like. And you don’t have to feel bad about it. Life is to short to not enjoy every minute you have on this earth.

There are a lot of ways to have fun without spending much money though. Here is a list of things you can do as a couple to have fun and make memories. Some might be a good fit for you, some might not, but there is a guarantee that you can find something that you enjoy that doesn’t cost a penny!

  • Hike
  • Free concerts in the park
  • Puddle jumping
  • Bike ride
  • Play Cards
  • Build a snowman
  • Read a book

Your goal this week is to start talking to your partner about what you want out of life. Determine if you are on the same page.

We are a couple that has changed our money-mindset within the last 2 years and crushed our debt. We are now Debt-Free and are saving to buy our first investment property. We are throwing as much money each month into our 401k, IRA’s and other investment accounts.

Read more of our content about real-life stories and ways to improve your money mindset at our Bucks & Dough website.

4 Financial Things to Talk About Before Marriage

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Before you tie the knot, it makes sense to get to know your potential marriage partner. One of the things it helps to know is how your potential partner will deal with finances.

My husband and I got engaged after three weeks, and married two months after that. We didn't have a lot of time to get to know each other — although we did spend a lot of time together talking about important things. We did talk about some money issues, but probably not all the issues we should have.

Before you get married, and especially if you decide to merge your finances, here are 4 financial things to talk about:

1. Debt

things to talk about before marriageThis is one of the most important things you need to discuss before you tie the knot. My husband and I talked about student loans, my credit card debt, and his car loan before we got married. You should come clean about your debt, and what you're doing about it, and your potential mate should come clean as well. Have an open and honest talk about the debt situation, and how you will tackle it together. This is a great time to lay a foundation for avoiding high-rate consumer debt in the future.

2. Income

It can be difficult to talk about income sometimes, since our society places so much emphasis on income and salary as status symbols. You might not want to appear as though you aren't making “enough.” Also, it can be uncomfortable if one of you makes a lot more than the other.

Talk about your expectations for the earning situation going forward, including whether or not you have a goal to become a one-income family (or one of your working part time) as part of your arrangements. These are things to talk about now, so that there aren't major surprises later.

3. Paying the Bills

How will you pay the bills? If you decide to completely merge your finances, like my husband and I did, this isn't as a big a deal since everything goes into — and comes out of — one big pot.

If you keep some separate accounts, though, this needs to be determined. Who will be responsible for which bills? Will you have one shared account for shared expenses, like housing, utilities, and groceries? If this is the case, then you need to figure out how much you each need to put in for these items. A percentage of income, based on what you each make? Or some other method?

This is not a fun conversation, but it's one that needs to be had.

4. Financial Priorities

Don't forget to have a talk about financial priorities. You need to determine what is most important for you to spend money on. This was something my husband and I didn't do, so it was a little surprising later to discover that we didn't always have the same ideas about how to spend our money.

The good news is that we share the same views on saving for retirement and what we are willing to go into debt for, as well as how to spend on our son. The other stuff has been worked out.

Making sure that you are financially compatible (or at least working toward it) can be a big part of harmony in your finances. Talk about these things before you get married so that you can work out any huge differences and problems ahead of time.

Young, Professional, And Single: Do You Need A Partner for Your Money?

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Last year, the Huffington Post published an article about how many Millennials are delaying marriage. The piece highlights the fact that, for many men, the average age for a first marriage is 28.7 and for women it is 26.5. (When I got married, more than 10 years ago, my age of 22 was older than Utah's average marriage age; these days it's younger.)

Why the delay? The Huffington Post article indicates that college debt is likely a factor. After all, few couples want to start out with a load of student loans to pay off. (Although it didn't stop my husband and me.) But there might be other reasons as well. Perhaps young, single professionals are so anxious to get a partner for their money.

Women and Money Today

Young, Single and Delaying MarriageOne of the reasons there might be a delay in marriage is that fewer women need men to help them on the road fo financial viability. With more women serving as breadwinners, there is less of a need for someone else to take partial responsibility for finances. Indeed, Stephanie Sims, the managing editor at Chicago Agent magazine makes this observation:

Single women homebuyers make up 20 percent of all homebuyers, and a percentage higher than single white men homebuyers at 12 percent. The correlation I draw from this, especially as it's becoming more acceptable to be a single mother and a single working mother, combined with skepticism about marriage due to the ever-increasing divorce rate, I believe more and more singles are making big investment decisions on their own and not waiting for a life partner to make them with.

While Ms. Sims doesn't have hard evidence to back up her correlation, I think she makes what is probably a good point. Women are making more money than they have traditionally. Additionally, there aren't the same social stigmas attached to being a single mother. And, while for many single working mothers the situation is very difficult without a partner, for the young professional who has an established career and relatively stable finances, it's more about choice. When will I start a family? And do I need to wait for the “right” partner to adopt or to get pregnant, when I can do it on my own?

The situation of the successful young professional woman is different from the single mother who got married and then suffered through a divorce, or from the young woman with an unplanned pregnancy who doesn't have the same level of career and financial success.

But when it comes to Millennials who haven't married, and have no children, the dynamic might be a little different. Whether you are a man or a woman, you might not feel the need to have a partner in your big money decisions — including those related to having children. When you are financially free already, and you get to do what you like with your money, it might not make sense to look for a partner for your finances. And, when you do, it might make sense to keep some of the money separate.

It's an interesting world out there, with more people waiting until their careers are settled to be married, and some deciding that it just isn't necessary. What do you think? Do you think that young professionals are moving away from financial marriage partnerships?

Financial Infidelity: Do You Lie Or Keep Secrets About Money?

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A topic that I see come up time after time on personal finance sites is related to married couples, and whether or not they should have joint accounts.  During those discussions one thing that invariably comes up is the topic of hiding money from one's spouse – or keeping secrets about what you're spending money on.

Today I thought I'd take a brief look at money secrets, and why people keep them.

How Many People Actually Keep Secrets About Money?

After reading the comments on several posts about having joint finances, I realized that there were probably more people keeping secrets about money from their spouses than I had originally thought.  Then I found a post on the Consumerist talking about financial infidelity.  It found that almost 1/3 of those polled admitted to lying to spouses about money.

An online poll commissioned by ForbesWoman and the National Endowment for Financial Education (NEFE) and conducted by Harris Interactive, surveyed 2,019 U.S. adults from December 17 to 21 and found that 31% of those who combined finances had admitted to lying to spouses about money. Another third of those admitted they themselves had been deceived about money.

For those couples experiencing financial infidelity, 67% said the deception led to an argument and 42% said it caused less trust in the relationship. A further 16% indicated the problem had led to divorce, and 11% reported a separation.

So almost a third have lied about money, and another third said they had been lied to. That's an amazing number of people lying about money!  Can people actually think that lying about money can be justified?

What Kinds Of Money Secrets Do People Keep?

The kind of money secrets that people keep seem to vary according to the study:

Among both offenders and victims, the leading money crimes were hiding cash, minor purchases and bills. Meanwhile, a significant number of people admitted hiding major purchases, keeping secret bank accounts and lying about their debt or earnings.

So for some reason people feel a need to hide cash, make purchases without their partner's knowledge and pay secret bills so they don't get caught.  Even more surprising to me is the number of people hiding more major purchases – opening secret bank accounts or lying about how much money they make.  There are even folks saving up money on the side “just in case” a marriage doesn't work out.  Talk about planning for failure!

I have an acquaintance who openly talked about having a secret bank account at work a few years ago.  Part of her paycheck went into the secret account so she could buy things she wanted, and the rest went into a joint account with her husband.  There was obviously little or no communication going on between husband and wife, and plenty of deception.  It was a big game of control – who could control the situation more.  Not surprisingly the two are now divorced, in part because of the deception and financial infidelity, but also because of sexual infidelity.  It was not a healthy relationship.

One matrimonial law expert, Nancy Chemtob,  feels like she has seen it all.  Some examples she gave on the Forbes article:

she once worked with the owner of a hedge fund who secretly spent millions on a mistress. In five of their 10 years of marriage, his wife had no clue that he was spending over $20,000 a month on the other woman, ultimately buying her a house, car and extravagant jewelry.

Another of her clients is in her 30s, remarried and has a son from a previous marriage, Chemtob says. Three years ago, she lied to her new husband that she wasn’t receiving child support. She was. Now he pays for the child’s expenses and private schooling while the woman stashes about $7,000 a month in a hidden bank account.

In one of the most extreme deceptions Chemtob’s come across, a 20-something woman fabricated her entire financial history. The original lie happened on the first date. Because he was very well-educated, successful and high-earning, she didn’t think he’d like her when she told him she didn’t have a degree or a job. She lied, saying she had her masters and a salaried position.

The woman continued the fib while they dated and into their eventual marriage. When he left home for work, she left too. When he returned home in the evening, so did she. Because he was so successful, he paid for everything and never noticed that she didn’t have an income. Eventually he did discover the truth and promptly filed for divorce.

The lies go on and on. Do people really think they can get away with the deception, and have no consequences?

Why Do People Lie About Money?

Why is it that people lie about money in the first place? Is it because they're selfish, insecure or just wanting to exert control in some way?

Boston-based family therapist Carleton Kendrick has been counseling couples for over 30 years and says money deception has become a huge issue in the last decade. He suspects the ease of using credit cards and purchasing online may make the act easier but doesn’t explain the lies.

Kendrick says the chief reasons people lie about money to their partners are pragmatism, control, guilt and fear. The pragmatic lie may result from planning an eventual split and not wanting the other to know how much money is available. Financial infidelity for control may include revenge spending, as one partner overspends to prove their independence or to get back at the other for something lacking in the relationship. Knowingly irresponsible behavior may cause guilt and embarrassment, so the person attempts to cover it up. Deceit may also occur because they fear their partner’s reaction to the truth.

Kendrick notes that how we are raised influences our money philosophies in relationships and can create some gendered behaviors or assumptions. “Girls still see their mothers at check-out, saying, ‘We won’t tell Daddy about this; it will be our little secret,’” he says.

So the reasons that people lie are just about as numerous and varied as the lies that people tell. They do it out of guilt, fear, control, and out of pragmatism when there is a faltering relationship.

What Can You Do To Fix Or Avoid Financial Infidelity?

So we've established that deception about money runs rampant these days, but what can we do to avoid having situations like this in our own marriages and relationships?

National Endowment for Financial Education’s Beck advises that couples have the money talk early–well before marriage–to avoid money lies in their relationships. If you are already married or in a committed relationship, he suggests using tax season as a nonthreatening way to ask your partner questions and gain a better grasp of shared finances. Those who suspect or discover that they are currently victims of financial infidelity should first figure out how deep the lies go and gather all the details.

One-third of those in relationships impacted by money deception say they have resolved to do something this year, with most planning to communicate more openly and create a shared budget for 2011.

To me the key here is for there to be plenty of open communication within a marriage. How do you foster those open lines of communication? By having shared weekly or monthly budget meetings, talking regularly about money with each other – even if one person is the main one doing the finances, and by creating a safe environment in the relationship for someone to ask forgiveness when they've done something they shouldn't have. They need to know the other person will be willing to forgive. And of course, you need to have a relationship where you're looking out for your partner's best as well – not just your own.

Have you ever kept a secret about money?  Did you feel justified in doing that, and if so, why?  Have you ever had to come clean about a deception, or had someone confess a deception?  Tell us your thoughts on money lies in the comments!